As a seasoned researcher and crypto enthusiast with years of experience in navigating the volatile world of digital assets, I must admit that October’s opening has been quite a rollercoaster ride for me. The market shakeout we’ve seen this month, often referred to as “Uptober,” has certainly tested my nerves but not my optimism.
Regardless of Bitcoin (BTC) ending September with a green close, the market experienced another round of selling as October began. The leading cryptocurrency dropped by 7%, causing unease among investors. Yet, many financial analysts are hopeful about BTC’s potential growth over the next quarter.
Is This The ‘Shakeout Before Breakout’?
Kicking off October, often referred to as “Uptober” within crypto circles, I found myself navigating the initial market turbulence of the quarter, with a 6.5% dip in the overall market capitalization. Notably, many cryptocurrencies within the top 100 witnessed a substantial price decrease. However, on a positive note, these same digital assets showed signs of recovery when viewed through a daily and weekly lens, painting green figures in the process.
Bitcoin, the most valuable cryptocurrency by market cap, saw a decline in its price that plummeted below the $61,000 support level, a range not visited for nearly two weeks. The descent appears to have been sparked by geopolitical tensions in the Middle East, with the drop coinciding with reports of an Iranian missile attack on Israel.
Yesterday’s news caused a surge of selling among investors, halting an eight-day trend of investment in Bitcoin spot Exchange-Traded Funds (ETFs) and leading to the forced closure of more than $526 million worth of leveraged positions over the past 24 hours.
Nevertheless, some industry observers seem unphased by the recent market turbulence, pointing out that it’s only the start of the month. In several previous bull markets, as noted by crypto analyst Jelle, Bitcoin has begun a new upward trend during October.
He explained that BTC’s price historically breaks out in the second or third week of the month, so the first week retrace could be the “final shakeout before new highs.” Moreover, he highlighted that the flagship crypto recently made the first higher high in 6 months and reclaimed the key resistance level above $60,000.
Jelle mentioned that Bitcoin (BTC) formed a new low on October 1, but managed to hold the $60,000 support level and demonstrated strength above $61,000. The analyst believes this signals the start of a breakout from the descending broadening wedge pattern he previously identified, with his original prediction for Bitcoin’s price reaching $90,000 still standing.
Analyst Warns About Bitcoin ‘Fifth-Day Plunge’
Additionally, other experts also voiced their opinions regarding the market consolidation. Notably, Altcoin Sherpa pointed out that the last instance of such significant compression in the 1-day Exponential Moving Averages (EMAs) was observed in September 2023, a period preceding an enormous market surge.
In other words, DonAlt took a more reserved stance, implying that Bitcoin might appear “even more unfavorable” given the current situation. However, he advised that it’s wiser to wait for the end of the week before making a definitive judgment.
However, Daan Crypto Trader noted an interesting pattern in Bitcoin’s price movement. Since June, Bitcoin seems to have reached its lowest or highest point around the same time. Interestingly, throughout this period, the price has shown a significant correction every fifth day of each month, with one exception being September, where the correction occurred on the sixth day instead.
During the Q3 pullbacks, Bitcoin showed daily drops in price before experiencing a significant drop on the fifth day. The value decreased by 16.3%, 25%, and 11% respectively during July, August, and September, from the start of each month until the end of the first week’s volatility.
If the current pattern continues in this month, there’s a possibility that Bitcoin’s value might fall below the recently established $60,000 resistance level and explore the resilience of lower support zones. Yet, such a scenario could also imply a potential recovery for Bitcoin by the beginning of the second week.
As of this writing, BTC is trading at $61,466, a 2% drop in the last 24 hours.
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2024-10-03 07:17